UT financial aid chief asked to quit federal panel

Published 5:30 am, Saturday, April 7, 2007

The University of Texas at Austin's financial aid director, who is on paid leave amid allegations of impropriety, has been asked to resign from a federal advisory committee on student financial aid, a U.S. Department of Education spokeswoman said Friday.

Education Secretary Margaret Spellings asked for the resignation of Lawrence Burt, an associate vice president at UT-Austin, after revelations that he owned stock in a lender that the school recommends to students.

The Education Department also placed a senior official, Matteo Fontana, who owned about $100,000 worth of stock in a student loan company while overseeing lenders, on paid leave. The case has been referred to the inspector general, department spokeswoman Katherine McLane said.

Burt has said that his ownership of stock in the company did not influence his decision to place Student Loan Xpress on the university's preferred lender list five years ago.

He earned about $14,250 — or $9.50 a share — on the sale of 1,500 shares in Education Lending Group, the former parent company of Student Loan Xpress in 2003.

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Spellings appointed Burt, a longtime financial aid officer at UT-Austin, to a three-year term on the 11-member advisory committee in January 2006. The committee makes recommendations toward improving federal aid programs, as well as higher education access and retention for low- and middle-income students.